"Together, the size and global reach of FireEye and Mandiant will enable us to innovate faster, create a more comprehensive solution, and deliver it to organizations around the world at a pace that is unmatched by other security vendors."

The transaction closed on 30 December but was only made public following close of business on Thursday. FireEye believe the acquisition will create a company with "the ability to find and stop attacks at every stage of the attack life cycle."

Under the terms of the acquisition, FireEye will issue an aggregate of 21.5 million shares and options with a current value of about $900m to purchase shares of FireEye stock. In addition, it will pay approximately $106.5m of net cash in the transaction to the former Mandiant security holders and certain performance-based retention equity incentives.

After the deal was announced FireEye shares rose nearly 23% in after-hours trading on the NYSE. The company also increased its revenue outlook for the fourth quarter of fiscal 2013, expecting a turnover between $55m and $57m, up from $52m to $54m.

Mandiant's Popularity

Mandiant gained popularity after it exposed a group of Chinese hackers last year which it alleged was a secretive branch of China's military and had stolen huge volumes of data from more than 100 firms around the world over a seven year period.

Mandiant is specialised in endpoint security, incident response, and remediation, with more than two million endpoints installed globally. It is a security advisor to more than one-third of the Fortune 100 companies.

"The combination of FireEye and Mandiant brings together two highly complementary companies, each a recognized leader and innovator in security, and creates an organization uniquely qualified to meet organizations' needs for real-time detection, contextual threat intelligence, and rapid incident response," FireEye said in a statement.

Kevin Mandia, Mandiant's founder and CEO, has been appointed as the COO of FireEye ahead of the acquisition.

Silicon Valley-based FireEye went public in 2013, and currently has a market valuation of more than $5bn.